orr has done. they have not met the prerequisites, people need to stay focused and look at h this governor, as well as mr. orr has not been transparent with the public or workers, in city of detroit, even though he sa that. charles: right. iican tell you that is the largest bankruptcy in america's history, we will stay tuned and stay focused and probably ask you back thank you for your time. thank you. charles: you inlanding gear fails in new york forcing a rough landing on top of crash landing in san francisco. where the entire landing failed. problems are adding up, and fear of flying piling up. any last requests mr. baldwin? do you mind grabbing my phone and opening the capital one purchase eraser? i need to redeem some venture miles before my demise. okay. it's easy to erase any recent travel expense i want. just pick that flight right there. mmm hmmm. give it a few taps, and...it's taken care of. this is pretty easy, and i see it works on hotels too. you bet. now if you like that, press the re

orr has done. they have not met the prerequisites, people need to stay focused and look at how this governor, as well as mr. orr has not been transparent with the public or workers, in city of detroit, even though he said that. charles: right. iican tell you that is the largest bankruptcy in america's history, we will stay tuned and stay focused and probably ask you back thank you for your time. >> thank you. charles: you inlanding gear fails in new york forcing a rough landing on top of crash landing in san francisco. where the entire landing failed. problems are adding up, and fear of flying piling up. in today's markets, a lot can happen in a second. with fidelity's guaranteed one-second trade execution, we route your order to up to 75 market centers to look for the best possible price -- maybe even better than you expected. it's all part of our goal to execute your trad in one second. i'm rricchan of fidelity investments. our one-seco trade execution is one more novative reason serious investor

is all that on the table, mr. orr? >> i said at the beginning everything's on the table. there are certainly questions regarding some of the grandmother's fine china and heirloom silver we have to address or not address. we're going to try to rationalize assets as best we can. >> some bankruptcy experts since you made your filing this week have said that you made a mistake. in fact, standard & poor's since your filing, has dropped detroit's bond rating to its lowest level. and it says that you're going to have a great difficulty, even if you restructure, even if you go through all this pain in getting investors ever to trust the city if they go out and try to borrow money again. >> mm-hmm. chris, i've heard that in many other contexts. and certainly i've been doing this now for the better part of three decades. and in every one i heard that no one would buy a car from a bankrupt auto company. some of these companies chrysler -- >> you are involved in the chrysler bankruptcy. >> every restructuring i've been involved in, i've heard doomsdayers say it's going to ruin it and

kevyn orr is detroit's emergency manager who has to figure out how to run the city. mr. orr, welcome to "fox news sunday." >> thank you, chris. >> chris: on friday a county judge ordered that the bankruptcy filing be withdrawn because she said that it violates the rights of the city pensioners. let's put up on the scene, because article 9, section 24 of the michigan constitution says the, quote, financial benefits of each pension plan and retirement system of the state and its political subdivision sham not be diminished. the state is appealing that court order, but is the county judge wrong? >> chris, as you just noted, that's currently in litigation on appeal to the michigan court of appeals. because of that, i'm somewhat limited in what i can or should say. suffice to say there are important questions of federalism involved. the automatic stay had automatically attached to that. that will be litigated in the courts. >> chris: obviously when you filed bankruptcy you knew what the michigan state constitution said, so why didn't that stop you? >> we have grievous problem

mr. orr is about to deliver a response to that first on cnbc. and speaking of detroit, are there really businesses and entrepreneurs who want to set up shop in that city? well, the answer is yes, especially if they were given jack kemp-like incentives to do it. you're going to meet two entrepreneurs who are raring to go in detroit. but first up, one of president obama's two political appointees at the irs is coming under increased scrutiny in the targeting scandal. turns out chief council william wilkins met with the president just two days before his office gave new instructions on applications from tea party groups. just what does that mean? and has this scandal jumped the fence from treasury into the white house? let us begin by asking elian a johnson of "national review, who has been covering this story. eliana, april 23rd, 2012, mr. wilkins was in a meeting with 13 people and the president. is that true? and does anybody have any reckoning of what went on there? >> he was in a meeting with 12 other people, including him and the president. a

we heard governor dismie der we heard mr. orr talk about a 58-minute response time for a 911 call. this is unacceptable. i mean, so i -- i hope it can be -- i hope we don't just regard this as some sort of morality play or these sturdy politicians did this. it is something significant and it's something that it is not unique. it is a terrible crisis and it's a human tragedy but it is not a unique american experience. >>brown: although there are some plments of mis-- elements of mismanagement we've heard in this story unfolding in the years. >> and the other thing that is common is the overpromising of pensions, whether it's illinois chicago california -- >> the ratings yesterday went down and so you know it is a problem. >> there is a possibility fo rebound. you know you never count out human beings and detroit has some advantages. it's got really cheap real estate. and a workforce. people who know how to work. history of that. it's got suburbs, some strength and creativity. and so often, in capitalism, when you hirt bottom you have some perverse advantages, low cost, people desiri

we heard governor dismie der we heard mr. orr talk about a 58-minute response time for a 911 call. this is unacceptable. i mean, so i -- i hope it can be -- i hope we don't just regard this as some sort of morality play or these sturdy politicians did this. it is something significant and it's something that it is not unique. it is a terrible crisis and it's a human tragedy but it is not a unique american experience. >>brown: although there are some plments of mis-- elements of mismanagement we've heard in this story unfolding in the years. >> and the other thing that is common is the overpromising of pensions, whether it's illinois chicago california -- >> the ratings yesterday went down and so you know it is a problem. >> there is a possibility for rebound. you know you never count out human beings and detroit has some advantages. it's got really cheap real estate. and a workforce. people who know how to work. history of that. it's got suburbs, some strength and creativity. and so often, in capitalism, when you hirt bottom you have some perverse advantages, low cost, people desir

mr. orr is clearly a competent articulate really sharp guy. math wins. in the end you cannot pay people money that you do not have. and so in the end that's what happened to detroit. math won. >> we used to call it the worker's paradise because it had everything. it had every conceivable benefit from the uaw and all these municipal government unions. doc, is there a hero here, is there a semihero here, is there a leader here? >> snyder and orr a little bit. he's done pretty well. despite all of the attacks that he's just racist and what not, he's done pretty well. he's doing the right thing. there is a problem with cities all across the country. we understand that it's time to grow when you have a bigger tax base and we want libraries answer all this stuff. with you most people don't understand that when that tax base shrinks, you have to have a shrink plan. and right now general motors is alive, but detroit is dead. so those jobs have not come back and they're not coming back. it's time for cities to have shrink plans. that's okay. >> steve, they can sh

orr is saying that the city of detroit can't keep overspending, mr. orr since he's been here has increased those contracts. >> there are hundreds of millions of dollars on top of that. all of that a small fraction that the billions the city owes but the unions say the payments show orr has not been negotiating in good faith and besides city workers say a promise is a promise. >> i thought that was a contract. you know, i thought work 30 years. whatever they decide on, the amount of money that you get every month is your retirement, and the i didn't think that could change. >> just heard from a spokesperson from kevyn orr defending those contracts saying the city needs a team to go ahead with the restructuring and that the city is so insolvent it would take decades to pay what the city owes to the police and fire unions. jones day has not responded for comment but the spokesperson for kevyn orr says that despite all of the billing that jones day has done, the firm has written off some $3 billion in bills it otherwise would have stuck on the taxpayers i

. >> mr. orr, you are an attorney. tell me what the legal status is now is. you need bankruptcy court approval of all of this. what steps have to be taken and how likely is it? >> well first, we filed yesterday so the automatic stay applies which means claims against us should be stayed. an eligibility determination has to be made. with the papers we filed yesterday and again some more this morning, we've asked a court to set out a schedule to be do that. we want to be very proactive in this process and give everybody an opportunity to bring their objections or even those that are in support at a very early stage to resolve this so we can move this as quickly as possible. we've also asked for the court to impanel a retiree committee so that the people hot current unions have declined to represent -- we asked them to, they said they wouldn't -- we'll have a forum for them to participate in this process and a group for us to negotiate with. we'll be very proactive, open and try to continue the efforts, even in this process to reach agreements on a consensual ba

. >> but we know a lot of this, even though mr. orr has not presented a formal plan in bankruptcy because he just went into bankruptcy, his june proposal to the creditors does lay out what the picture looks like, and what the picture looks like is a 90% cut in cities -- in all the obligations the city can cut his the unsecured debt and he's also proposing to invest $1ment 25 billion over the next five years. the. >> 9% of crime is solved, 58-minute average response time by the police. national average is 11 minutes. >> so you can see the outlines of almost a best case plan which are the massive haircuts for the workers and for the unsecured debt holders and then a relatively small amount of money available to actually invest and try to rebuild the city. i don't believe, having been in business for a reasonable long time and done some construction work. i don't believe it helps whether there's the state, the federal government, the two, combinations just don't work. >> this is the filing that went through with the judge. on the seco

i believe what mr. orr is talking about, since detroit has delayed bankruptcy, it gives detroit a cash flow, he's telling reporters that detroit had no choice, that could provide for basic services in the city of detroit. so now the long slog begins to financial recovery. of course, we'll keep you posted. >>> 21 minutes past the hour, the head of the nsa speaking out in defense of the controversial surveillance program. >> the purpose of these programs, the reason we use secrecy is not to hide it from the american people, not to hide it from you, but to hide it from those who walk among you who are trying to kill you. >> general keith alexandre said the agency has, quote, concrete proof terrorists are making changes in reaction to information made public by edward snowden. >>> another sign of the narrowing divide between -- target, or tar-jay is adding beauty consequence years of ages, a fancy title to people who helps to choose the right shades of makeup. >>> in sports, the nba's unveiling five new rul

mr. orr is right. you can't go to washington to look for a bailout because the washington doesn't have any money to bail them out with. bill: you say if you are 50 cents on the dollar? >> possibly. bill: where did you get that percentage? >> these are how large the debts are. almost half of the debt of the city is at ain't l attributable to the pension liabilities they doesn't have the money to pay, bill. you just dot math. could you see as much as a 50% reduction. we don't know for sure, by the way the other people who are on the line here, are the people who own the bonds. they will take a big haircut or maybe a crew cut as well. a the lo of people think the municipal bonds they hold in their portfolios, safe, risk-free investments. guess what? we learned last week they're not so risk-free an people who own the bonds will also not get the money they are owed. bill: it is thought washington could step in here and help out detroit. it was reported late last week, that the emergency manager kevyn orr ha

i see that as mr. vernon orr's basic position and other than that, alexandra, it's going to go to bankruptcy court and you'll be at the whim and mercy of one judge >> yes. >> and all bets are off in the bankruptcy court. you know what, look, could end up, precedent has shown that it wouldn't but anything can happen. the point is that right now ken orr has said that these bonds are currently on par with pension and other obligations, and they are not. they have not been in the past so that's the real issue. it's, you know, sort of sacreligious what he's done for those of us who have been in the bond industry for all this long and not even talking about the revenue bonds which are actually backed by a specific stream of income which he's also taken away as well. >> all right. have to leave it there. thank you, alexandra labenthal. that's it for this evening's show. i'm larry kudlow. we hope to see you back here tomorrow night, hopefully with more free market ideas. she knows you like no one else. and you

. >> they'd have been better off taking kevin orr's deal. you are so right. mr. bob lutz, thank you very much. appreciate it. good luck on the book. folks, a little later on in the program, i'm going to give you my take on how to fix detroit's problems. here's a preview. i'm going to call for economic growth incentives. it can't all be about cutting budgets and bailing out unions. that's for sure. but next up, do stocks seem like a bubble right now to you? even some very weak earnings from microsoft and google only resulted in a flat day on the markets today. so we'll debate these markets just ahead. don't forget, free market capitalism is the best path to prosperity. that's why detroit needs free market capitalism. i'm kudlow. we'll be right back. (announcer) at scottrade, our clients trade and invest exactly how they want. with scottrade's online banking, i get one view of my bank and brokerage accounts with one login... to easily move my money when i need to. plus, when i call my local scottrade office, i can talk to someone who knows how i trade. because i do

a filed for chapter nine bankruptcy after failing to reach agreements with bondholders in creditors mr or told citizens yesterday the city's services for now are unaffected police and fire departments will operate as usual. services. change just trying to stay. ordinary citizens. bankruptcy is a complicated process results depend on location and where proceedings occur so let's dig into the fine print of municipal bankruptcy is and how detroit could be affected here is for the city could take place in detroit kentucky ohio or tennessee the bankruptcy judge will be the one who determines first an automatic stay will be issued on the city's obligations to halt creditors from collecting debts this includes losses lawsuits against the city from pension officials and union members the automatic stay will allow the city time to renegotiate its contracts then the droid's will have to meet eligibility requirements under chapter nine the first one is authority the city walls will have to prove prove its insolvent and has a desire to adopt a plan to adjust its debt and the court grants detroit t

filed for chapter nine bankruptcy after failing to reach agreements with bondholders and creditors mr or. told citizens yesterday the city services for now are unaffected police and fire departments will operate as usual all. services remain open paychecks will be made bills will be paid nothing changes from the standpoint of the ordinary citizens perspective. municipal bankruptcy is a complicated process results depend on location and where proceedings occur so let's dig into the fine print of municipal bankruptcy is and how detroit could be affected here is for the city could take place in detroit kentucky ohio or tennessee the bankruptcy judge will be the one who determines first an automatic stay will be issued on the city's obligations to halt creditors from collecting debts this includes losses lawsuits against the city from pension officials and union members the automatic stay will allow the city time to renegotiate its contracts then the droid's will have to meet eligibility requirements under chapter nine the first one is authority the city was allowed to prove its insolvent